JSE-listed Imperial Holdings is offering to repurchase its preference shares for R85.53 a share, which is a 29% premium to Friday’s closing price of R64.29.
The company on Monday stated that the offer price values the preference shares at R83, with an accrued dividend of R2.53 since June.
Imperial preference shareholders will receive a dividend of R4.17 a share on October 1 for the six months ended June 30.
Imperial is redeeming its preference shares to simplify its capital structure ahead of its plan to unbundle its vehicle trading division into an independently listed company called Motus.
Redeeming the preference shares will result in a one-off accounting profit of R64-million as it was treated as a financial liability for accounting purposes.
The company expects transaction costs to be around R2-million.